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Previous message: john ernst: "[OPE-L:4005] Depreciation"
Quoting me, Jerry wrote:
John wrote in [OPE-L: 4000] [!];
a) > In CAPITAL, Marx seems to assume that capitalists base their
> guesses on the life of fixed capital based on experience. In
> general, he assumes a machine will last 10 years.
b) > The anticipated
> prices of inputs and outputs are INITIALLY assumed to be those
> that exist when the investment is made.
Jerry then commented:
These are two different criteria: a) guesses based on experience; b)
anticipated prices are initially assumed to be those that exist when the
investment is made.
John states:
Yes, indeed, they are different. Note my emphasis on "INITIALLY."
Jerry went on:
Yet, capitalists know from experience that their past guesses regarding
the prices of inputs and outputs have not been correct and that if they
assume initially that the anticipated prices will equal the current
prices then they are in for a (most likely) rude surprise.
Consequently. wouldn't it be more reasonable for us to anticipate that
capitalists at least *try* to anticipate moral depreciation?
John comments:
Agreed again. That is the point. I think that by using what we call
straight line depreciation, anticipated price decreases of both
inputs and outputs are tacitly assumed. Hence, they did anticipate
the moral depreciation as they made their investments. We have no
evidence that they used the technological life of fixed capital in
setting up depreciation schedules. Further, I do not think one can
argue that Marx did claimed that they did. Here I think I am in
disagreement with Andrew.
John